Final Results

NMT Group PLC
23 April 2001

23 April 2001

                                NMT GROUP PLC

           PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2000


NMT Group, the manufacturer of retractable devices to prevent needlestick
injury, announces its preliminary results for the year ended 31 December 2000.

Announced Today (see separate press announcements)

  * Distribution agreement with Southern Syringe Services, leading UK
    hospital products distributor, giving NMT national coverage of the UK
    hospital market

  * Distribution agreement with Medcore AB in Sweden

Highlights for the Period



  * Loss (pre-exceptional items) of £10.2m (1999: £7.1m) in line with
    expectations
  * Successful £24.1m (net) Placing and Open Offer completed in July 2000
  * Good progress made towards resolution of manufacturing issues

  * Volume and quality of 3cc syringe output showing dramatic improvement
  * 1cc syringe now being manufactured

  * Strengthening of senior management team
  * Contract awarded to supply syringes to Premier, largest group purchasing
    organisation in US
  * NMT's product offering broadened through IV safety catheter supply
    agreement with Eastern Medikit of India; further such agreements
    anticipated
  * Needlestick Safety and Prevention legislation enacted in the US in
    November 2000
  * Favourable outcome in first phase of patent infringement litigation

Commenting on the results, Roy Smith, Chief Executive Officer, said:

'Over the past twelve months, we have made very substantial progress in
resolving the manufacturing challenges which faced NMT. 2001 will be a
critical year as we make the transformation to high volume manufacture. With
the passing of the needlestick legislation in the US at the end of last year
and the growing awareness of safety issues in Europe, we remain convinced that
there is a significant commercial opportunity for NMT and are confident that
we will secure strong growth in future years.'

Enquiries:
NMT Group PLC                                         Tel: [phone]
Roy Smith, Chief Executive Officer
Tony Fletcher, Chief Operating Officer
Financial Dynamics
David Yates/Fiona Noblet                              Tel: [phone]



CHAIRMAN'S STATEMENT

A year ago I announced the appointment of Roy Smith as our new Chief
Executive. At our Annual General Meeting on 11 May, Roy confirmed that he was
undertaking a thorough review of the business and that the Group would require
funding in the short term.

During the fundraising, a business plan was developed which would enable the
Group to develop its manufacturing capacity of safety syringes and to provide
a broader range of safety products. One year on, I am able to report that we
raised £24.1m (net of expenses) from new and existing shareholders in July,
which has provided us with the necessary capital to address our manufacturing
issues and enable us to build a platform to allow high quality/high speed
assembly of 3cc and 1cc syringe products.

Since Roy's arrival, we have continued to move from a 'start-up' management
team to one that is able to build and manage a fully operational,
international manufacturing and marketing organisation. Throughout the latter
half of 2000, the Group made excellent progress in resolving the manufacturing
challenges and, while further work will be required during this year, I remain
confident that the results of these efforts will become evident during 2001.

Losses for the year of £13.2m (1999: £7.1m) were realised on turnover of £0.4m
(1999: £66,000) and were in line with expectations. These losses included £
3.0m of exceptional administration expenses, of which £1.7m related to a
provision for the impairment to the value of intellectual property rights, as
a result of product design changes and the global re-branding programme. The
remainder of these expenses relate to restructuring costs. The loss per share
of 8.8p compared with a loss of 12.6p in 1999.

The balance sheet remained strong with a cash balance of £19.9m at the end of
the year.

As reported in our Interim Results, Harry Bocker (Finance Director and Deputy
Chief Executive), Michael Brander (Corporate Director and Company Secretary)
and Garry McGrotty (Commercial Director) resigned from the Board in May.

I am pleased to welcome Tony Fletcher who joined the Board in June 2000. In
his role as Chief Operating Officer and Finance Director, Tony's wealth of
experience in both manufacturing and finance is proving invaluable to the
Group.

The senior management team has been further strengthened with the appointment
of Iain Kennedy as General Manager of the Livingston facility and Steve Czick
as President of New Medical Technology Inc., our US Company. These
appointments have brought additional management skills and experience that are
essential to the fulfilment of NMT's strategy.

The calibre of NMT's staff has undoubtedly been reinforced during 2000. Whilst
there are the inevitable management changes following the introduction of a
new senior management team, we are fortunate in having a dedicated, skilled
workforce. We were 166 strong at the close of the year and expect to increase
to a headcount in excess of 200 in 2001. Without the support of our dedicated
workforce, the Company could not have transformed itself so quickly.


The need to avoid needlestick injury is now recognised internationally. The
enactment in the US of the Needlestick Safety and Prevention legislation in
November 2000 confirms that North America will be NMT's main market and
therefore the principal driver of our manufacturing plans. I believe that high
quality automatic retraction needle devices will be the future safety products
of choice and that NMT syringes are the best available.

We have made favourable progress with regard to the two patent infringement
lawsuits brought by Medsafe Technologies LLC and Syringe Development Partners
LLC against the Group. Summary Judgment in regard to non-infringement of the
first patent has been awarded in favour of the Company and New Medical
Technology Inc. I continue to believe that the outstanding patent claims can
also be successfully defended.

Our strategy is to broaden our product portfolio so that we can offer an
extensive range of safety syringes and other safety products that utilise our
safety needle technology. We will continue to expand our syringe assembly at
Livingston, but will also consider contracting out manufacture of other safety
devices, where appropriate.

We have laid the foundations of a high quality safety needle company, which I
believe will be able to participate fully in the rapidly expanding world
market.

I am confident that the team now in place will deliver our planned business
strategy.

Roger Gilmour

Chairman

CHIEF EXECUTIVE'S REVIEW

Achievements


'The key achievement during 2000 and early 2001 was the creation of a robust
platform to allow a ramp up in manufacturing that, in turn, should deliver
good sales growth during the remainder of 2001.'

The year 2000 was clearly a watershed for NMT Group PLC. Late in 1999 and
early 2000, the Group's major problem was its inability to manufacture a range
of 3cc products in high volume at the appropriate quality.

I joined the Company as Chief Executive in April 2000 and was shortly joined
in June by Tony Fletcher, Chief Operating Officer and Finance Director. Tony
and I were most encouraged by NMT's technology and we firmly believed that
while the Group was facing severe difficulties, with additional investment it
would be possible to significantly improve the performance of the business.
Furthermore, the ever-increasing demand in the US for legislation mandating
the use of safety needle devices demonstrated that the commercial opportunity
for NMT was, and still remains, unquestionable.

In June, a thorough review of the business was completed and the required
funding was identified to provide the necessary cash to deliver a ramp up in
manufacture, to invest in sales and marketing, and to broaden the safety
product portfolio. A successful Placing and Open Offer was completed during
July and the Company raised £24.1m net of issue costs.

Throughout the summer and latter part of 2000, substantial restructuring was
undertaken to strengthen the management team across all functions within the
Group.

One immediate move was the formation of cross-functional project teams,
designed to ensure a multi-disciplinary approach to problem solving in all
fields, including production, manufacturing engineering, quality and product
design. These teams were able to harvest the expertise that existed throughout
the Company and to deal with major areas of concern in a structured and
disciplined manner.

By the close of 2000 nine out of the eleven components in the 3cc syringe had
been re-designed in order to increase end-use functionality and to facilitate
high volume manufacture. The Group has formed close relationships with its
suppliers who have been highly supportive in assisting the Group to meet its
objectives.

An additional key area of focus has been the strengthening of our sales and
marketing organisation to ensure that we can obtain appropriate value for our
product offering, optimise the market access opportunity, and confirm that
future product launches are in line with customer expectations.

Operational review

'To provide a platform to underpin consistent high volume output'

To achieve our operational objectives, management time was directed to three
key areas: assembly process, product design and people.


Assembly process

Re-engineering of the assembly process has been essential and substantial
effort has been applied to redesigning the component assembly and handling
processes.


Two of the most fundamental changes made to the 3cc manufacturing equipment
related to syringe end cap assembly and spring manufacture. In late 2000, a
new end cap bonding process was developed and trials were undertaken with the
supplier of NMT's assembly equipment. During February 2001, the existing
equipment was successfully modified. Our original assembly equipment
configuration included integrated spring coilers, which proved unreliable and
erratic. Following detailed analysis, NMT decided to outsource spring
manufacture to a supplier with many years experience in this type of industry.
There have been numerous other changes to the assembly equipment, which have
improved manufacturing efficiencies.

Product design

During the year, customer feedback indicated that the syringe was not
performing to an optimum level and that further design work was necessary. The
functionality of the syringe improved considerably in the last months of 2000
following our re-design programme. We are confident that the quality of
finished product is now of an appropriately high standard to defend its added
value premium.

Additionally, we have extended the range of 3cc syringes with various needle
sizes on offer to customers.

People

Iain Kennedy joined the Group as General Manager of the Livingston facility in
June 2000 and has proved a great asset, possessing a wealth of experience
within highly automated assembly businesses. He is a 'hands on' senior
executive who has been instrumental in creating the multi-functional team
approach to problem solving. Business unit management has been introduced at
Livingston, whereby each automated assembly machine comprises its own
engineering and quality support functions. In addition to production
personnel, these support staff report directly to each unit manager. The Group
has invested heavily in manufacturing engineering resource, which is critical
to ensuring the reliability of our production machines.

We have also worked far more closely to develop partnerships with suppliers,
including manufacturers of assembly equipment, multi-cavity tooling and
injection moulding. It was critical that these suppliers should understand our
requirements and work with us to devise robust solutions.

'Broadening the product offering'

Throughout 2000, the major objective of ensuring that the Sortimat assembly
machines were capable of manufacturing the full range of 3cc syringes was
largely accomplished. NMT took receipt of a third Sortimat machine in March
2001, which will provide additional manufacturing capacity of 3cc syringes.

In August 2000, NMT received delivery of a Mikron assembly machine, which is
now fully validated. The Mikron line is specified to produce a full range of
1cc products, a critical complement to the 3cc offering.

During 2001, we will consider expanding our manufacturing capacity to include
5cc syringes to serve the European market.

We have appraised several manufacturing companies to assess their suitability
as suppliers of other NMT patented safety devices. One such company is Eastern
Medikit of New Delhi, a leading manufacturer of intravenous (IV) catheters. We
have chosen Eastern Medikit to manufacture our IV safety catheter, which was
developed in-house and is intended for launch towards the close of 2001.

In the short term, the Livingston facility will focus on the assembly of NMT's
range of high value syringes. Our strategy will be to outsource the
manufacture of additional devices to other companies, which can achieve
appropriate cost and quality standards.

'Areas of focus 2001'

The primary objective during this coming year will be to take the Group to
profitability in 2002. NMT will focus on continuous improvement and an
aggressive added-value engineering programme. We will continue to invest in
people and their training requirements, important activities that will
underpin our demanding growth and cost targets.


Research and development

The top priority of the research and development group has been to deliver the
redesign of the current syringe product range to facilitate high volume
manufacture. The current device remains subject to continuous design
improvement to reduce unit cost. This will be critical, as the requirement to
deliver large volumes at lower cost becomes of increasing importance in the
medium-term.

In addition to its core portfolio, the Group is developing a broad range of
other safe needle devices, which we intend to launch during late-2001 and into
2002. These include intravenous (IV) catheters, butterfly and phlebotomy
products (blood draw). The design criteria are that such products should be
easy to manufacture, be cost effective and complementary to the syringe
offering.

During 2000, work was started to develop a series of options to provide a
pre-fill safety syringe using NMT's in-house needle retraction technology. NMT
is looking externally to facilitate market entry into this growth area, by
seeking formal alliances with leading pharmaceutical companies to fund the
commercialisation of this technology.

The criteria for all new product development, which will be synergistic with
the NMT business strategy, are as follows:

                      - High degree of safety
                      - Significant clinical value
                      - Little change to clinical practice
                      - Good margin
                      - Global brand equity
                      - Strong intellectual property

Regulatory, quality assurance and intellectual property

The NMT quality system remains core to our business. During the year 2000, we
were audited by SGS Yardsley International Certification Services, who
confirmed that NMT is operating to the required standards with no significant
non-conformance. This opinion augurs well for the expansion of manufacturing
capacity during the next two years.

During 2000 and the first quarter of 2001, documents were correlated and
application has been submitted to the US Food and Drug Administration (FDA) to
register our syringe product range for additional intravenous (IV) usage. This
will broaden the clinical application of the device and will be particularly
valuable in supplying product for needle exchange programmes for drug abusers.
To maintain quality, our suppliers undergo a thorough audit from NMT qualified
staff. This programme is continuous, with all suppliers being re-audited over
a two-year period.

NMT has maintained a policy of protecting its intellectual property in key
markets. The needle retraction mechanism patent has now been granted in most
jurisdictions. Additional patent applications for butterfly, phlebotomy and
catheter devices were filed during 1999 and 2000.

To extend the life of the current syringe design, further patents will be
sought. Patents supporting second-generation syringe design have already been
filed with further additions planned during 2001.

NMT has made favourable progress with regard to the patent infringement
lawsuit brought by Medsafe Technologies LLC and Syringe Development Partners
LLC ('SDP'). On 9 February 2001, the Federal Court in Indiana granted Summary
Judgment in favour of NMT in respect of alleged infringement of the first of
two patents. The Court left open for trial the matter of invalidity with
regard to the first patent. During NMT's fund raising in June 2000 a second US
patent, which is a continuation of the first patent, was issued to SDP. NMT
has filed suit in Indiana for declaratory judgment relative to this second
patent on the grounds of invalidity, non-infringement and unenforceability.
SDP has filed suit against NMT for patent infringement. The same court in
Indiana, which delivered summary judgment on the first SDP patent, will now
hear the infringement and declaratory judgment actions relating to the second
patent.

NMT believes the Court's decision that there was no infringement of the first
patent supports the Company's view that the NMT safety syringe does not
infringe any of SDP's patents. We continue to believe that the outstanding
claims can be successfully defended and that this lawsuit is unlikely to have
a material impact on our business.


Legislation

Legislative pressure in the United States for the adoption of safety needle
devices intensified last year. President Clinton signed the Needlestick Safety
and Prevention Act on 6 November 2000, which was legislation requiring the
revision of the Federal Occupational Safety and Health Administration (OSHA)
blood-borne pathogens standard within six months.

On 8 January 2001, OSHA revised the standard, confirming the requirement for
employers to select safe needle devices, as they become available with
employees being involved in the choice of safe needle device systems. OSHA
also stated that these rules should become effective by 18 April 2001. While
this is a relatively dynamic environment and further changes to the timetable
may be published, it remains likely that safe needle technology will be
mandated in the US during the summer of this year. This is excellent news for
NMT. We believe that automatic needle retraction technology offers the
ultimate solution to employee safety.

NMT believes that governments in Europe will follow the American example in
due course. There is already evidence in the UK, France and Italy of
increasing awareness of the dangers associated with needlestick injury. NMT
representatives have attended a number of informative medical conferences
during the year where needlestick injury was a major item on the agenda. We
believe that it is only a matter of time before Europe follows American
practice.

Sales and marketing

Last year was also a watershed for sales and marketing. Graham Walker was
appointed International Sales Director, with prime responsibility for sales
development within Europe. For the nineteen years immediately preceding his
appointment to NMT, Graham held senior management positions in Becton
Dickinson, the leading syringe company.

Steve Czick was appointed as President of New Medical Technology Inc in
January 2001. He has had over 25 years experience in Johnson & Johnson, the
majority of that time as Vice President of Sales and Marketing.

These two appointments are crucial to the future success of NMT as the Group
aims for impressive sales growth and market penetration during 2001 and
beyond.

Marketing and distribution strategy

NMT has assessed other safety products that are currently available or being
developed. We still believe that the NMT syringe is the best in class and will
command a premium price. NMT's target markets are acute hospitals (infection
control clinics, emergency rooms etc), correctional facilities (prisons),
occupational health and vaccine programmes.

The Company is also targeting pharmaceutical companies, which may wish to
provide the NMT safety syringe as part of an added-value product with an
associated drug, particularly for the treatment of HIV (Aids), HBV and HCV
(Hepatitis B and C).

Direct sales to end users via speciality distributors are considered the
optimum route to market. Specialty distributors understand the value
proposition and their sales organisations are technique sensitive. They often
have a strong relationship with the end user and our product range will be
targeted as a top priority brand within their sales portfolios.

We have already secured agreements with a number of specialty distributors in
the US and Continental Europe to ensure that we obtain the maximum market
penetration for our product offering. We shall be seeking to secure further
such agreements during 2001.

Sales strategy

During the year, the majority of NMT's sales came from the US. Our
distributors remained enthusiastic despite frustrations with NMT's inability
to satisfy demand and its limited range of products. Our US sales support team
should be congratulated for their careful management throughout this difficult
period. The willingness of our distributors to continue their partnership with
NMT also confirms our belief that the opportunity for strong growth in the US
exists and that the NMT product proposition remains the best available.

Key factors augur well for NMT's future sales growth. We were awarded the
Premier Purchasing Partners, LLP ('Premier') contract to supply its hospitals
with NMT safety syringes. Premier is the largest group purchasing organization
('GPO') in the US. While NMT is not the sole supplier in this contract, it
clearly validates our technology and the Group now has the opportunity to
fight for market share. In November and December 2000, NMT supplied safety
syringes to the Visiting Nurse Association of America to complete their
respective influenza vaccination programmes in the states of Minnesota and
California. This intensive trial of the NMT Safety Syringe, over a very short
period of time, was further endorsement of our technology. Customer feedback
was particularly valuable and we have made further enhancements to optimise
our product performance.

Towards the end of the summer, the NMT safety syringe was selected for a
global clinical trial by a leading pharmaceutical company for use in the
treatment of a major blood borne pathogenic disease.

In early January 2001, the Group announced the relocation of our US office
from Indiana to Massachusetts. Many medical device companies are situated in
this State and we will be able to attract staff of high quality.

NMT has made important additions to the sales executive team, principally in
the US, but also in setting up a small sales team for the UK domestic market.
The UK sales group will work with chosen distributors to ensure that the NMT
product range receives adequate priority and selling time. NMT has also
increased its clinical nurse support team to ensure that users of its product
are adequately trained.

We now have a strong sales and marketing team that is well qualified to
deliver future growth. We believe that the demand for safety products will
outstrip supply for the foreseeable future. Therefore, it is vital that our
sales and marketing organisation establishes a firm market position as soon as
possible, so that NMT products are those that the medical profession prefers
to use, particularly in high-risk environments.


Outlook

The year 2001 is clearly critical. The transformation from product concept to
high volume manufacture, accompanied by rapid sales growth, is a significant
challenge. We have made substantial progress to date, although this has yet to
show in our financial performance. The manufacturing challenge continues to
remain difficult and time consuming, but focusing on a 'Process, Product and
People' framework is resulting in major improvements.

The management team is first-class and I have every confidence that NMT will
make progress during 2001.

Our competitors face many barriers to entry, which should not be
underestimated. The safety syringe business is not only highly capital
intensive, but also the complexity of distribution and manufacture demands a
tremendous amount of time, energy, application and patience.

The introduction of new legislation in the United States has created a huge
opportunity for NMT and coupled with increasing awareness of safety issues in
Europe, the Group will be able to build on this and other related developments
to secure strong growth during future years.

Roy Smith

Chief Executive



FINANCIAL REVIEW

Operating Results

Turnover of £441,000 primarily comprised of sales to the US and was
significantly higher than the 1999 figure of £66,000, reflecting the expansion
of 3cc syringe production output. Operating losses rose to £13.7m (1999: £7.4m
loss) as the asset base of the business has grown, but include exceptional
administration expenses of £3.0m, which comprise a £1.7m charge resulting from
the impairment of intellectual property rights and £1.3m relating to
restructuring costs and write off of certain deferred charges.

Net interest receivable of £0.5m resulted in a loss after tax of £13.2m (1999:
£7.1m).

The loss per share of 8.8 pence reduced from 12.6 pence per share in 1999, as
a result of an increase in the weighted average number of shares to 150.1m
shares from 55.8m. This reflected the issue of 171.3m additional shares in the
year.

Financial position and cash flow

The Group's financial position at year end may be summarised as follows:

                                                             2000          1999
                                                            £'000         £'000

Cash at bank and in hand                                   19,930         8,868
Bank loans                                                      -       (1,500)
Obligations under finance leases                          (2,205)       (1,090)

                                                            _____         _____
                                                           17,725         6,278
                                                            _____         _____

The increase in net funds of £11.4m to £17.7m during the year resulted from
the proceeds of share issues of £24.7m (net of expenses) during the year. The
bank loan of £1.5m was repaid and additional leasing of £1.5m was secured on
the Sortimat 2 assembly machine.

A net cash outflow of £0.9m compared with a net inflow of £1.2m in 1999. After
adjusting for movement in liquid resources and changes in net debt, a net
funds inflow of £11.5m in 2000 compared with £4.5m in 1999.

Net cash outflow from operating activities of £9.6m (1999: £7.1m outflow)
comprised £10.4m cash outflow arising from operating performance, offset by a
£0.8m reduction in working capital.

Capital expenditure of £2.5m (1999: £2.6m) continued to reflect the build-up
in manufacturing capacity with the purchase of automated assembly equipment
and associated component tooling.

Consolidated Profit and Loss Account

For the year ended 31 December 2000

                                                                      Restated
                                                               2000       1999
                                                              £'000      £'000
Turnover                                                        441         66
Cost of sales                                               (5,070)    (2,799)
                                                              _____      _____
Gross (loss) / profit                                       (4,629)    (2,733)
Distribution costs                                          (2,339)          -
                                                              _____      _____
Normal administration expenses                              (3,708)    (5,297)
Exceptional administration expenses                         (3,030)
Total administration expenses                               (6,738)    (5,297)
Other operating income                                            -        612
                                                              _____      _____
Operating loss                                             (13,706)    (7,418)
Interest receivable                                             733        509
Interest payable                                              (254)      (150)
                                                              _____      _____
Loss on ordinary activities before and after tax           (13,227)    (7,059)
                                                              _____      _____
Loss per share
Basic and diluted                                            (8.8)p    (12.6)p
                                                              _____      _____




Balance Sheets

At 31 December 2000
                                               Group               Company
                                             2000        1999     2000     1999
                                            £'000       £'000             £'000
Fixed assets
Intangible assets                               -       1,810        -    1,110
Tangible assets                             9,940       7,064    9,940    7,064

                                            9,940       8,874    9,940    8,174
                                            _____       _____    _____    _____
Current assets
Stocks                                        960         520      935      520
Debtors                                       729         742    5,306    3,540
Cash at bank and in hand                   19,930       8,868   19,867    8,849

                                           21,619      10,130   26,108   12,909
                                            _____       _____    _____   ______
Creditors
Amounts falling due                       (3,328)     (2,555)  (3,173)  (2,514)
within one year
                                            _____       _____    _____    _____
Net current assets                         18,291       7,575   22,935   10,395
                                            _____       _____    _____    _____
Total assets less current liabilities      28,231      16,449   32,875   18,569
                                           ______       _____    _____    _____
Creditors
Amounts falling due                       (1,661)     (1,782)  (1,661)  (1,782)
after more than one year
                                            _____       _____    _____    _____
Net assets                                 26,570      14,667   31,214   16,787
                                            _____       _____    _____    _____

Capital and reserves
Called up share capital                    11,708       3,142   11,708    3,142
Share premium account                      39,949      23,784   39,949   23,784
Profit and loss account                  (25,087)    (12,259) (20,443) (10,139)
                                            _____       _____    _____    _____
Equity shareholders' funds                 26,570      14,667   31,214   16,787
                                            _____       _____    _____    _____


Statement of Total Recognised Gains and Losses

For the year ended 31 December 2000
                                                     Group          Company
                                                   2000    1999    2000    1999
                                                  £'000   £'000    £000   £'000
Loss on ordinary activities after tax           (13,227) (7,059)(10,744) (5,389)
Exchange adjustment on retranslation of             (41)     -       -       -
subsidiary
                                                  _____   _____   _____   _____
Total gains and losses relating to the year     (13,268) (7,059)(10,744) (5,389)
                                                  _____   _____   _____   _____



Reconciliation of Shareholders' Funds

For the year ended 31 December 2000
                                                   Group           Company
                                                 2000    1999     2000    1999
                                                £'000   £'000     £000   £'000
Total gains and losses relating to the year  (13,268) (7,059) (10,744) (5,389)
Placing and Open Offer                         24,117  15,346   24,117  15,346
Share options - exercised                         614              614
- application of UITF 17                          440      55      440      55
                                                _____   _____    _____   _____
Total movements during the year                11,903   8,342   14,427  10,012
Shareholders' funds at 1 January               14,667   6,325   16,787   6,775
                                                _____   _____   ______   _____
Shareholders' funds at 31 December             26,570  14,667   31,214  16,787
                                                _____   _____    _____   _____




Consolidated Cash Flow Statement

For the year ended 31 December 2000

                                                                   2000    1999
                                                                  £'000   £'000

Net cash outflow from operating activities                      (9,632) (7,140)
                                                                  _____   _____

Returns on investments and servicing of finance
Interest received                                                   697     472
Interest paid                                                     (254)   (150)

                                                                    443     322
                                                                  _____   _____

Capital expenditure and financial investment
Purchase of tangible fixed assets                               (2,523) (2,575)

Cash outflow before management of liquid resources and         (11,712) (9,393)
financing
                                                                  _____   _____

Management of liquid resources
Cash (placed on) term deposit                                  (11,934) (4,300)
                                                                  _____   _____

Financing
Term loan (repayment)                                           (1,500)       -
Finance lease - repayment of principal                            (457)   (496)
Proceeds on issue of shares                                      26,079  16,025
Expenses of share issue                                         (1,348)   (679)

                                                                 22,774  14,850
                                                                  _____   _____

(Decrease)/Increase in cash in the year                           (872)   1,157
                                                                  _____   _____